Board Paper of Class 12-Commerce 2013 Accountancy MeritNation(SET 1) - Solutions
1) This question paper contains two sections: A and B.
2) Section A is compulsory.
i. This section consists of 2 compulsory questions.
ii. Question No. 1 carries 20 marks.
iii. Question No. 2 carries 10 marks.
iv. This whole section is of 30 marks in total.
i. This section consists of 8 questions.
ii. Attempt any 5 questions from question nos. 3 to 10 carrying 14 marks each.
iv. This whole section is of 70 marks in total.
- Question 1
Answer briefly each of the following questions : [10 × 2] = [20 Marks] (i) Give two differences between Net Profit and Cash from Operations. (ii) When does Loss on Issue of Debentures arise ? (iii) Give two differences between Authorized Capital and Issued Capital. (iv) Why is the word memorandum affixed to the Memorandum Joint Venture Account ? (v) How is double entry completed in the General Ledger when ledgers are kept under the
Self Balancing System ?
(vi) What is the accounting treatment of Employees' Provident Fund appearing in the
Balance Sheet of a partnership firm at the time of its dissolution ?
(vii) Give the formula for computing Price Earning Ratio. (viii) Give two differences between Reserve Capital and Capital Reserve. (ix) How will the firm show the amount payable to the retiring partner, if it is not in a
position to immediately pay the amount due to him on his retirement?
(x) What accounting steps are taken by a partnership firm when a new partner is unable to
bring the business guaranteed by him ?
- Question 2
Alex, John and Sam are partners in a firm. Their capital accounts on 1st April, 2011, stood at Rs 1,00,000, Rs 80,000 and Rs 60,000 respectively. [10 Marks] Each partner withdrew Rs 5,000 during the financial year 2011-12.
As per the provisions of their partnership deed :
(a) John was entitled to a salary of Rs 1,000 per month. (b) Interest on capital was to be allowed @ 10% per annum. (c) Interest on drawings was to be charged @ 4% per annum. (d) Profits and losses were to be shared in the ratio of their capitals. The net profit of Rs 75,000 for the year ended 31st March, 2012, was divided equally amongst the partners without providing for the terms of the deed.
You are required to pass a Single Adjusting Journal Entry to rectify the error.(Show the working clearly).
- Question 3
Reliable Ltd. was registered with an authorised capital of Rs 20,00,000 in Rs 10 per equity share. It invited applications for issuing 1,00,000 equity shares at a premium of Rs 2 per share. The amount was payable as follows: [14 Marks] On application Rs 4 per share (including premium) On allotment Rs 3 per share Balance on 1st and Final Call
Applications were received for 1,30,000 shares. Applications for 10,000 shares were rejected and the application money received on them was refunded. Pro-rata allotment was made to the remaining applications. Amount overpaid on these applications was adjusted towards the amount due on allotment. Sameer, who had applied for 1,200 shares, failed to pay the allotment and call money. The company forfeited his shares, out of which 800 shares were reissued to Sanjay at Rs 9 per share fully paid.
You are required to :(i) Pass the Journal Entries in the books of the company through Calls in Arrears Account.VIEW SOLUTION
(ii) Prepare the Share Allotment Account.
- Question 4
Arthur Ltd. reported a profit of Rs 90,000 for the year ended March 31, 2012, after considering the following: [14 Marks]
Rs (a) Tax provided during the year 3,000 (b) Amortisation of goodwill 12,000 (c) Profit on sale of land 5,000 (d) Writing off preliminary expenses 2,000 (e) Machinery costing Rs 40,000 (accumulated depreciation thereon being Rs 18,000) was sold during the year at a loss of Rs 17,000
Extracts of its Balance Sheets at the beginning and at the end of the year are given below:
01.04.2011 31.03.2012 Account Receivable 16,000 20,000 Stock 15,000 12,000 Cash at Bank 10,000 8,000 Account Payable 11,000 9,000 Expenses Payable 5,000 6,000 Provision for Taxation 6,000 4,000 Investments (short-term) 2,000 5,000 Plant and Machinery (net value) 1,30,000 94,000 Proposed Dividend 10,000 12,000
You are required to calculate Cash from Operating Activities as per Accounting Standard-3. (Show your working clearly.) VIEW SOLUTION
- Question 5
Following is the Balance Sheet of Ravi and Prakash as on 31st March, 2012 : [14 Marks]
as on 31st March, 2012
Sundry Creditors 60,000 Cash 25,000 Ravi’s Loan 15,000 Debtors 42,000 General Reserve 15,000Less: Prov. of D/D (6,000) 36,000 Invest. Fluctuation Fund 2,000 Stock 12,000 Ravi’s Capital 30,000 Investments 18,000 Prakash’s Capital 10,000 Plant and Machinery 41,000 1,32,000 1,32,000
The firm was dissolved on 31st March, 2012, on the following terms:(a) Ravi took over stock at Rs 8,000.
(b) Creditors payable after two months were paid immediately at a discount of 6% per annum.
(c) Debtors realized Rs 35,000.
(d) Plant and Machinery and Investments realized Rs 60,000.
(e) An old computer completely written off was taken over by Prakash at Rs 1,200.
(f) Realization expenses of Rs 2,000 were paid by Ravi.
You are required to prepare:(i) Realisation Account.VIEW SOLUTION
(ii) Partners’ Capital Account.
(iii) Cash Account.
- Question 6
Neha and Tara are partners in a firm sharing profits and losses in the ratio of 3 : 2. Their Balance Sheet on 31st March, 2012, stood as follow: [14 Marks]
as on 31st March, 2012
Liabilities Amount (Rs) Assets Amount (Rs) Capital Accounts: Plant & Machinery 12,000Neha 8,000 Land and Building 14,000Tara 10,000 18,000Debtors 19,000 General Reserve 12,000Less: Prov. for D/D (4,000) 15,000 Workmen’s Compensation Fund 5,000 Stock 6,000 Creditors 15,000 Cash 3,000 50,000 50,000
They agreed to admit Prachi into partnership for 1/5th share of profits on 1st April, 2012, on the following terms:(a) All debtors to be considered as good and therefore, the provision for doubtful debts to be written back.
(b) Value of land and building to be increased to Rs 18,000.
(c) Value of plant and machinery to be reduced by Rs 2,000.
(d) The liability against Workmen’s Compensation Fund is determined at Rs 2,000 which is to be paid later in the year.
(e) Prachi to bring in her share of Goodwill of Rs 10,000 in cash.
(f) She will further bring in cash so as to make her capital equal to 20% of the total capital of the new firm. (Show your working clearly)
You are required to prepare:(i) Revaluation AccountVIEW SOLUTION
(ii) Partners' Capital Accounts.
(iii) Balance Sheet of the reconstituted firm.
- Question 7
(a) The following information is available from the books of Greg Foods Limited: [14 Marks]
RsEquity Share Capital 1,00,0008% Preference Share Capital 40,000Reserves and Surplus 60,000Investments 30,000Current Assets 70,000Proprietary Ratio is 0.8 : 1.Assuming that there are no fictitious assets, calculate the value of the fixed assets of the company.
(b) The following figures have been extracted from the records of Allen Cosmetics Limited:
RsCost of goods sold 4,00,000Current liabilities 90,000Profit margin is equal to 20% on selling price.Working Capital Turnover Ratio is equal to 10 times.Determine the value of the Current Assets of the company
(c) The following details are available from the books of Simon Gadgets Limited:
RsSales 8,00,000Opening stock 40,000Closing stock 50,000Gross Profit Ratio is 20%Calculate the Stock Turnover Ratio of the company (up to two decimal places).
(d) The following data is available from the records of Johnson and Company Limited:
Cash in hand
10% Preference Share Capital
Equity Share Capital
Net profit after tax
Calculate the following (up to two decimal places) :(i) Current Ratio.VIEW SOLUTION
(ii) Quick Ratio.
(iii) Return on Equity Shareholders’ fund.
- Question 8
Andrew and Roger entered into a joint venture and agreed to share profits and losses in the ratio of 3 : 2 respectively. Andrew purchased goods worth Rs 1,00,000 in cash. He spent Rs 10,000 on freight and insurance and dispatched
the goods to Roger. Roger got the goods released from the transport company and paid Rs 5,000 on carriage up to the
warehouse and Rs 10,000 as rent of the warehouse. Roger sold 80% of the goods for Rs 3,00,000. He was entitled
to receive commission @6% of the sales. He later informed Andew that the remaining goods were destroyed by fire.
Since the goods in the warehouse were not insured, Roger agreed to bear the entire loss which was valued at
original cost plus proportionate expenses. The accounts were settled between the co-ventures by means of a bank draft.
You are required to prepare in the books of Andrew:(i) Joint Venture Account.
(ii) Roger’s Account. [14 Marks]
- Question 9
Sim, Tim and Jim are partners sharing profits and losses equally. Their Balance Sheet as on 31st March, 2012, stood as follows: [14 Marks]
Balance Sheet Particulars Amount (Rs) I. LiabilitySim’s Capital 2,50,000Tim’s Capital 2,00,000Jim’s Capital 1,50,000Creditors 1,40,000General Reserve 60,000 8,00,000 II. AssetsBuilding 2,00,000Plant and Machinery 1,00,000Patent and Copyright 1,50,000Stock 1,25,000Debtors 1,50,000Bank 75,000 8,00,000
From April 1, 2012, the partners decide to share profits and losses in the ratio 3 : 2 : 1 and for that purpose the following revised value of assets were agreed upon:
Building Rs 2,75,000; Plant and Machinery Rs 90,000; Patents and Copyrights Rs 1,32,500; Stock Rs 2,00,000; Prepaid Insurance Rs 5,000 and Debtors Rs 1,42,500.
Goodwill of the firm was valued at Rs 60,000.
Partners decide not to disturb the reserves. Also they decide not to record the revised value of assets in the books of Accounts.
You are required to prepare:(i) Partners’ Capital Accounts.
(ii) Balance Sheet of the re-constituted firm.
(Show your workings clearly.) VIEW SOLUTION
- Question 10
Peter’s books show the following details for the month of April, 2012: [14 Marks]
Creditors Balance (01.04.2012) 4,000 16,000 Creditors Balance (30.04.2012) 10,000 ? Particulars Amount (Rs) Particulars Amount (Rs) Purchase (including cash Rs 4,000) 1,04,000 Bills payable renewed 1,000 Cash paid to creditors 30,000 Discount received 4,000 Bills Receivable endorsed 20,000 Returns outward 12,000 Bills Receivable endorsed
4,000 Bills payable accepted
(excluding bills renewed)
30,000 Transfer from debtors ledger to
5,000 Bills payable matured 5,000
You are required to prepare General Ledger Adjustment Account in the Creditors’ Ledger. VIEW SOLUTION